Note: In 2018, C.R. Bard (BCR) was removed from the Index after it was acquired by fellow Dividend Aristocrat Becton-Dickinson (BDX). On January 24th, 2018, Praxair (PX), Roper Technologies (ROP), and A.O. Smith Corporation (AOS) were added to the Dividend Aristocrats Index.

The downloadable Dividend Aristocrats Excel Spreadsheet List below contains the following for each stock in the index:

10 Year historical price-to-earnings ratio

Price-to-earnings ratio

Expected total return

Modified PEG ratio

Dividend yield

5 Year Beta

Growth rate

All Dividend Aristocrats are high quality businesses based on their long dividend histories. A company cannot pay rising dividends for 25+ years without having a strong and durable competitive advantage.

But not all Dividend Aristocrats make equally good investments. You can use the Dividend Aristocrats spreadsheet to quickly find quality dividend investment ideas.

How to Use The Dividend Aristocrats List To Find Dividend Investment Ideas

The list of all 53 Dividend Aristocrats is valuable because it gives you a concise list of all S&P 500 stocks with 25+ consecutive years of dividend increases.

These are businesses that have both the desire and ability to pay shareholders rising dividends year-after-year. This is a rare combination.

Together, these two criteria are powerful – but they are not enough. Growth and value must be considered as well.

The spreadsheet above allows you to sort by forward price-to-earnings ratio (or PEG ratio) so you can quickly find undervalued, high quality dividend stocks.

Here’s how to use the Dividend Aristocrats list to quickly find high quality dividend growth stocks potentially trading at a discount:

Note that a good portion of the outperformance relative to the S&P 500 comes during recessions (2000 – 2002, 2008). Dividend Aristocrats have historically seen smaller drawdowns during recessions versus the S&P 500. This makes holding through recessions that much easier.

Great businesses with strong competitive advantages tend to be able to generate stronger cash flows during recessions. This allows them to gain market share while weaker businesses fight to stay alive.

The Dividend Aristocrats Index has trounced the market over the last decade…

A company that pays dividends is likely to be generating earnings or cash flows so that it can pay dividends to shareholders. This excludes ‘pre-earnings’ start-ups and failing businesses. In short, it excludes the riskiest stocks.

A business that pays consistent dividends must be more selective with the growth projects it takes on because a portion of its cash flows are being paid out as dividends. Scrutinizing over capital allocation decisions likely adds to shareholder value.

I believe that Dividend Aristocrats have historically outperformed the market and other dividend paying stocks because they are, on average, higher quality businesses.

A high quality business should outperform a mediocre business over a long period of time, all other things being equal.

For a business to increase its dividends for 25+ consecutive years, it must have or at least had in the very recent past a strong competitive advantage.

Sector Overview

A sector breakdown of the Dividend Aristocrats index is shown below:

The top 3 sectors by weight in the Dividend Aristocrats are Consumer Staples, Industrials, and Health Care. The weight of these sectors in the S&P 500 is shown below for comparison:

Consumer Staples: 9.0%

Industrials: 10.3%

Health Care: 14.5%

The Dividend Aristocrats Index is tilted toward Consumer Staples and Industrials relative to the S&P 500.

It is also significantly underweight the Information Technology sector.

The IT sector comprises 22.3% of the S&P 500, and just 2.2% of the Dividend Aristocrats Index.

The Dividend Aristocrats Index is similar to Warren Buffett’s dividend holdings; underweight technology, overweight high quality established businesses in stable industries.

The Dividend Aristocrat Index is filled with stable ‘old economy’ consumer products businesses and manufacturers; the 3M’s (MMM), Coca-Cola’s (KO), and Johnson & Johnson’s (JNJ) of the investing world. These ‘boring’ businesses aren’t likely to generate 20%+ earnings-per-share growth, but they also are very unlikely to see large earnings drawdowns as well.

The Dividend Aristocrats In Focus Analysis Series

You can see analysis on every single Dividend Aristocrat below. Each is sorted by GICS sectors and listed in alphabetical order by name: